August 7, 2008

Mines Shut By Strike in South Africa

Striking workers in South Africa protesting rising electricity, food and fuel prices forced mines and factories to shut on Wednesday, bringing major sectors of the continent's biggest economy to a standstill.

The one-day strike helped push global platinum prices up 3 percent and added to investors' worries about South Africa.

Thousands of workers assembled outside the city hall in the capital, Pretoria, and a sea of supporters gathered in Cape Town, where Parliament is situated. The police were called in to keep order in demonstrations across the country.

The Congress of South African Trade Unions, which has almost two million members and is an ally of the African National Congress, says the action was a warning to employers not to dismiss workers because of a drop in profit.

South Africa, struggling with 23 percent unemployment, has felt the global impact of rising food and oil prices, which workers say has pushed them deeper into poverty.

"We are poor, we are hungry, and our wages are no longer coping with our demands and the demands of feeding and clothing our families," Zwelinzima Vavi, general secretary of the confederation, told the protesters outside the closed gates of Parliament. "If government is not going to move with the necessary speed, we will again hit them where we know they will feel the pain."

The union group has vowed to fight President Thabo Mbeki's market- friendly and pro-business stance and wants his government to subsidize basic staples and pay workers better.

The unions are close to the leader of the governing party, Jacob Zuma, who is likely to succeed Mbeki after general elections next year if he beats graft charges in court.

Clad in the red colors of the labor federation, protesters snarled traffic as they marched through the streets of Pretoria and waved placards that read: "Say no to the high food prices!" and "My take-home salary is not even enough to take me home!"

Charles Cavids, 54, a bakery worker with four children, said: "The government must reverse the high food and petrol prices. The poor are getting poorer."

Mines, carmakers, textile factories, and businesses were shut as workers stayed away. Many workers and students stayed at home because public transportation was disrupted, and normally busy streets in central Johannesburg were quiet as businesses closed.

Analysts said the strike could further hurt a slowing economy, with growth estimated at about 3 percent this year, compared with an average of 5 percent over the past four years.

"Our economic growth rate has already been slowed down substantially in response to tight monetary policy, lower global demand and the electricity shortfall," said Elna Moolman, economist at Barnard Jacobs Mellet in Johannesburg.

In the mining sector, a pillar of the economy, workers are particularly fearful of job cuts after a five-day power shortage shut the mines in January. The rationing of electricity to mines since then has further slashed output and profit.

Originally published by Reuters.

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